Combating IPR Infringement in the Supply Chain IPR Enforcement Conference 21 June 2016 Brussels, Belgium

Crime outstripping enforcement and regulatory agencies The current dynamics: Transition of counterfeit from luxury items to general consumer products: Exploitation of underdeveloped countries Challenge to public attitude of a “victimless crime” Raises the stakes and criminal status of the act Crime outstripping enforcement and regulatory agencies Political fatigue Globalisation assisted by the virtual market place Slow realisation of the scale Length of the supply chain protects the perpetrator and adds to cost of enforcement action

Market perspective Counterfeiters’ production entering increasingly global market place, facilitated by the Internet They follow recognisable business models Fakes have an international supply chain Rights holders, regulators and enforcement agencies need to focus on source Continued focus on destination Diminishes return on effort Only addresses the smaller players Little or no risk to the counterfeiter Manufacturing bases & Markets = Counterfeiting bases & Markets Fakes have an international market and need transportation Express carriers are not immune Members have global networks and reach Members’ capacity to identify nature of goods is limited Member operations are integrated and transparent “end to end” Members transport goods in good faith Members’ brands are global and are targets in their own right EEA members recognise: Concern for society and the economies they service Rights holders are also our customers Need to reinforce relationships with Customs and stakeholders

Seizures from express have decreased Number of Cases/Seizures by Mode of Transport In the EU seizure cases in express shipments in 2014 decreased to 4,117 from 7,390 in 2013. Stakeholders need to focus on the origin to have a marked effect: Greater chance of significant impact Non registration of trade marks in country of manufacture means sourcing is legalised IP legislation and penalties in country of manufacture required to support enforcement agencies Better return on resource and effort Cut out source and attack the main beneficiary Regulatory framework to encourage bilateral enforcement activities

Secure and compliant operations The Express industry has established, enhanced processes and procedures that promote a secure and compliant supply chain: Compliance with international legislation (Annex 17 ICAO, Doc 30 ECAC, Reg 185/2010, Decision 2010/774) Significant investment in facility security and inspection systems supported through our own internal audit programme. Global training programs & procedures in place Source: Global Express Association

Express delivery chain The express industry utilizes sophisticated networks to collapse the time and distance between places thereby globally connecting business. Shipments from anywhere, to anywhere can be delivered within 24-72 hrs How we help Customs identify and stop IPR violations: Advance electronic shipment information: Express delivery companies transmit electronic information in advance of arrival of shipments to enable Customs to perform risk assessment and target shipments for further examination. Track and Trace: Systems allow packages identified by Customs as suspicious to be removed from traffic flows and provided to Customs officers for further examination. Facilities: Express delivery companies provide Customs officers at express delivery hubs with adequate facilities and equipment to enable them to identify and examine suspect shipments efficiently. Information on shippers and consignees: Express delivery companies provide Customs administrations with available relevant information that may legally be disclosed on shippers and consignees of shipments identified as containing offending goods. Close accounts of customers publicly identified by Customs as repeat offenders. Source: Global Express Association

Joint pilot project with OLAF Identified threat Legal Framework Structural Description Stakeholders Objective of the Pilot Project Operational Targets Modus Operandi Operational Description Exchange of Information Roles of European Commission (OLAF) and Europol Briefing Meeting De-Brief Meeting and Reporting Financing Communication Coordinators Participating States Rights holders Law enforcement authorities Sponsor Organisations Express operators

The express industry is committed to fight IPR violations The primary liability of a third-party carrier in the case of an IPR infringing shipment is to provide information on that shipment when requested to do so by Customs and other regulatory or enforcement authorities in accordance with applicable law. IPR offences are committed by shippers and/or consignees, NOT by freight forwarders and/or postal and delivery service providers. We welcome all initiatives of the European Commission, regulators and enforcement agencies in cooperation with their counterparts in third countries, that focus on the source of counterfeit and IPR-infringing goods. Customs-Integrators partnership: Integrators have limitations Not the originator of the sales transaction, the shipment or the information No expertise to identify counterfeit material No law enforcement authority Potentially bound by data protection and commercial sensitivity regulations Customs has powers Mandated to intercept counterfeit crossing international borders Authority for detention and investigation, using access to IPR holders/experts Enforcers of EU and national legislation; IPR, safety and security Both share concerns and a desire to address them To address the increasing problem of fakes in the international supply chain To build on mutual understanding of legitimate trade and the express model To make best use of the resources available, including data

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